gross profit

USAGE SUMMARY

"gross profit" is a correct and usable term in written English.
It is used to describe the total income of a business minus the total expenses. For example: The company reported a gross profit of $10 million in the last quarter.

✓ Grammatically correct

Formal & Business

News & Media

Science

Wiki

Human-verified examples from authoritative sources

Exact Expressions

54 human-written examples

Gross profit margin (sometimes just called "gross margin") is different that gross profit.

WikiHow

Gross profit margin is the ratio of your gross profit to your total revenue.

WikiHow

Gross profit margin is not a complete picture.

WikiHow

Analysts closely watch Apple's gross profit margins.

The New York Times - Tech

The gross profit would be less.

The New York Times

Gross profit increased by 9.3% to £77m.

The Guardian - Business

Human-verified similar examples from authoritative sources

Similar Expressions

6 human-written examples

The gross profit is reduced by future foreclosure losses.

The New York Times

The gross-profit-per-day objective is more described hereinafter.

Journal of Shipping and Trade

Kick off a cost-cutting, gross-profit-building mission.

Huffington Post

URML: Union régionale des médecins libéraux; GPPMP: Gross profit of private medical practice; GI: Gross income.

BMC Family Practice

The first is that the model objective maximises voyage gross profit, while in tramp shipping the objective has to maximise gross profit per day.

Journal of Shipping and Trade

Expert writing Tips

Best practice

When discussing a company's financial health, clearly differentiate between "gross profit", operating profit, and net profit to provide a comprehensive view.

Common error

Avoid using "gross profit" and net profit interchangeably. "Gross profit" only accounts for the cost of goods sold, while net profit reflects all expenses, providing a more accurate picture of overall profitability.

Linguistic Context

The phrase "gross profit" functions primarily as a noun phrase within financial and business contexts. It names a specific financial metric. According to Ludwig, it is a correct and usable term in written English.

Expression frequency: Very common

Frequent in

News & Media

30%

Formal & Business

30%

Science

20%

Less common in

Wiki

15%

Encyclopedias

0%

Reference

0%

Ludwig's WRAP-UP

The phrase "gross profit" is a widely used and grammatically correct term that refers to the difference between revenue and the cost of goods sold. As Ludwig AI confirms, it’s a standard term in business and finance. It is essential to distinguish "gross profit" from other profitability metrics like operating profit and net profit. "Gross profit" is commonly found in news articles, formal business reports, and scientific publications, emphasizing its importance in financial discussions. Understanding the calculation and interpretation of "gross profit" is crucial for assessing a company's financial health.

More alternative expressions

Phrases that express similar concepts, ordered by semantic similarity:

Revenue less cost of goods sold

A more descriptive way of defining gross profit by detailing its calculation.

Total revenue less cost of sales

A broader term that includes all sales and their associated costs.

Gross margin

Refers to the percentage of revenue exceeding the cost of goods sold, indicating profitability.

Sales profit

Emphasizes the profit directly resulting from sales activities.

Profit margin

Indicates overall profitability, considering all expenses, not just the cost of goods sold.

Profit before expenses

Highlights the unadjusted profit before any deductions.

Operating profit

Profit after deducting operating expenses but before interest and taxes.

Income from sales

Focuses solely on the income generated from sales activities.

Net profit

The remaining profit after all expenses, including taxes and interest, have been deducted from revenue.

Earnings before interest and taxes

Focuses on profitability before financing and tax impacts.

FAQs

How is "gross profit" calculated?

"Gross profit" is calculated by subtracting the cost of goods sold (COGS) from total revenue. This figure represents the profit a company makes before deducting operating expenses, interest, and taxes.

What's the difference between "gross profit" and "net profit"?

"Gross profit" only considers the cost of goods sold, while "net profit" accounts for all expenses, including operating expenses, interest, and taxes. "Net profit" provides a more comprehensive view of a company's overall profitability.

How does "gross profit" differ from "gross profit margin"?

"Gross profit" is the absolute dollar amount of revenue remaining after subtracting the cost of goods sold. "Gross profit margin" is the percentage of revenue remaining after subtracting the cost of goods sold, providing a relative measure of profitability.

What can a company do to improve its "gross profit"?

A company can improve its "gross profit" by increasing revenue (e.g., raising prices or selling more units) or by decreasing the cost of goods sold (e.g., negotiating better prices with suppliers or improving production efficiency).